August 31, 2007

EarthLink’s chief executive, Rolla P. Huff, told Mr. Newsom in a telephone call on Wednesday that “they were not going to be able to fulfill their end of the bargain,” Mr. Ballard said. “Mr. Huff made it clear it wasn’t going to happen with EarthLink; they are getting out of the Wi-Fi business.”

EarthLink had already announced plans to cut costs by eliminating 900 jobs, about half its work force, and closing its offices in four cities, including San Francisco.

[...] Under the four-year agreement, which was never completed because of a political tug-of-war between the mayor and the governing Board of Supervisors, EarthLink was supposed to bear the cost of building and maintaining the Wi-Fi system, estimated at $14 million to $17 million.